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What are some of the biggest legal issues small businesses face?

On Behalf of | Jan 23, 2023 | Business Law

As a small business owner, you understand there are risks you accept when starting a business. In addition, you will likely have to invest significant time and resources to build the company, and you may find yourself doing this while working another job to support you and your family.

Often, the financial and practical risks of starting a business are so worrisome that they deter people from pursuing their entrepreneurial dreams. On top of that, there are legal liabilities that must be addressed and managed to ensure that your business is protected in the future. Some common legal issues that frequently affect small businesses involve the company’s personnel, premises, and products or services.

Employment law

Employees are essential to the success of a small business. That is why it is important to understand the nuances behind the different types of employment disputes that can lead to legal claims. Understanding the common issues regarding harassment, wage disputes, and Workers’ Compensation can protect your business from expensive litigation and potential reputation damage. Common employment disputes often include harassment, discrimination, and claims regarding wages, overtime, and salary. Educating yourself on common employment disputes can help you provide a better environment for your employees and a better overall small business experience for yourself.

Premises liability

Premises liability is a legal concept that holds business owners responsible for the injuries that occur within their business or on their property. Therefore, the facilities where your business operates is an inherent source of legal risk. If anyone falls and gets hurt while visiting your company, they could sue the business and seek damages related to their injuries, pain and suffering, and other expenses, such as lost wages or medical care. Accordingly, it is important to have legally adequate policies and procedures to manage possible hazards, such as puddles or dangerous walkways, in order to keep your small business safe and sustainable

Product or service liability

Product liability deals with a defective product that is sold to a consumer, which allegedly causes injury. Similarly, service liability addresses services performed by a company that result in an alleged consumer injury. Regardless of the type of business you own, there can be legal and financial liabilities related to the services you provide for others or the products that you produce, distribute, and/or sell. Defective products, subpar services, or inadequate warnings could lead to consumer lawsuits against your company.

Furthermore, poorly written contracts, haphazard business planning, and lack of knowledge about regulations can increase the risk of personal injury claims, prolonged litigation, and significant unexpected expenses. The best way to handle potential legal issues is to identify them early in the business planning process and take steps to protect your new company.

It is important to know your business and your industry inside and out, in order to understand your company’s obligations to its employees, its duties to consumers, and regulatory requirements. Moreover, it is best practice to consult with an attorney to identify and mitigate the legal risks that could negatively affect your company in particular.

Arnett Law Group, LLC

At Arnett Law Group, we recognize the importance of protecting small businesses and minimizing legal risks for emerging entrepreneurs. To ensure maximum protection and prolonged success, it is important that you have knowledge of common legal issues, as well as the advice and assistance of the experienced business law attorneys found at


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